Recently our team explained why we're bullish going into the end of the year. From stronger retail sales, to an improving PMI, and better GDP estimates, equities (SPY) should continue their trek higher.
But even though this is the highest probability scenario, a good investor always makes sure to test his/her theses. Our team does this through a process we call "red teaming".
So the question we need to ask ourselves now is… "what could put a crimp in this market rally?"
The answer is the US dollar (UUP).
The greenback has been on a rampage since Trump's win. The reason behind the run is simple. Trump winning is seen as the beginning of a massive shift in the US's policy mix. Trump's infrastructure spending plans mean looser fiscal policy. And his disdain for the Fed in addition to rising rates means tighter monetary policy. This combination of loose…
